The demands for high-performance solid components are constantly increasing. The reason for this development are the steadily growing requirements such as weight reduction, higher resistance to load stresses, and more functional integration. By using material compounds, for example high-strength steel and aluminium alloy, hybrid massive components, whose properties are specially adapted to the specific application, can be manufactured. The first challenge is the joining of two dissimilar materials like steel and aluminium alloy by laser beam welding. In particular, the formation of hard and brittle intermetallic phases (IMP) has a high influence on the mechanical properties of the joining zone. The second challenge is to examine the machinability of such dissimilar compounds. The machining process is mandatory in order to reach an adequate level of accuracy of shape and dimensions. Furthermore, the functionalization of the hybrid compounds will be realized with the machining process where required surface roughness and lifetime-determining residual stresses are adjusted. Connections between induced residual stresses and material properties have been investigated. A significant influence of machining parameters on the surface and subsurface properties is evident. In particular, the cutting edge rounding has a deep impact on the residual stresses as well as on surface roughness.